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Beautiful Jewellers Private Limited v. Tiffany & Co.

March 21, 2007

BEAUTIFUL JEWELLERS PRIVATE LIMITED, PLAINTIFF,
v.
TIFFANY & CO., DEFENDANT.



The opinion of the court was delivered by: Kimba M. Wood, U.S.D.J.

OPINION AND ORDER

Plaintiff Beautiful Jewellers Private Limited ("BJP") brought this action against Defendant Tiffany & Co. ("Tiffany") on April 21, 2006, for breach of contract, breach of fiduciary duty, unfair competition, deceptive practices, unjust enrichment, promissory estoppel, and an accounting. Tiffany has now moved to dismiss all counts of the Complaint, pursuant to Federal Rule of Civil Procedure 12(b)(6), for failure to state a claim on which relief can be granted. For the reasons stated below, the motion is granted in part and denied in part.

BACKGROUND*fn1

BJP is an Indian corporation headquartered in Mumbai. (Compl. ¶ 1.) In 1996, BJP entered into an agreement with Tiffany, a Delaware corporation whose principal place of business is New York, whereby BJP would be the exclusive distributor and retailer of Tiffany products in India. (Id. ¶¶ 2, 5.) The agreement was to last as long as Tiffany sold its products in India. (Id. ¶ 5.) Under the agreement, Tiffany sent personnel to India to construct a branded Tiffany outlet within BJP's Mumbai jewelry store. (Id. ¶ 6.) BJP spent more than $1 million on merchandise, advertising, media coverage, and New York staff training, but Tiffany retained control over marketing, product presentation, store layout, and other creative and financial aspects of the distributorship. (Id. ¶¶ 7-8.)

In 2002, Tiffany asked BJP to set up a stand-alone Tiffany boutique in Mumbai. (Id. ¶ 10.) BJP spent a substantial sum preparing the boutique in conformity with Tiffany specifications, including the cost of a four-year retail lease with a Mumbai hotel, the Oberoi. (Id. ¶¶ 10-12.)

Beginning in early 2004, Tiffany began to refuse to meet all BJP's orders for the region or provide enough goods to satisfy orders, which caused BJP monetary damages as well as damage to its reputation and goodwill. (Id. ¶ 13.) Then, on March 9, 2005, Tiffany informed BJP in writing that it was terminating the distribution relationship. (Id. ¶ 14.) BJP believes that Tiffany is now selling products in India through a competing distributor. (Id. ¶ 15.)

DISCUSSION

I. Standard for a Motion to Dismiss

A defendant may move to dismiss a claim under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim on which relief can be granted. In weighing a motion to dismiss, the Court must "accept[] as true the factual allegations in the complaint and draw[] all inferences in the plaintiff's favor." Allaire Corp. v. Okumus, 433 F.3d 248, 249-50 (2d Cir. 2006). "A complaint may not be dismissed under the Rule unless it appears beyond doubt, even when the complaint is liberally construed, that the plaintiff can prove no set of facts which would entitle him to relief." Id. at 250 (internal quotation marks omitted).

II. What Documents May Be Considered

In support of its motion, Tiffany has submitted copies of various faxes and e-mails between the parties. (See Reply Aff. of Ewa Zalewska, Ex. A-C.) These exhibits were not included with the Complaint, and they are not documents on which BJP "solely relies and which [are] integral to the complaint." Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 47 (2d Cir. 1991). As a result, unless the Court excludes them at this stage, it must convert the motion to one requesting summary judgment and delay consideration of the motion until both sides have a reasonable opportunity to present pertinent evidence. Fed. R. Civ. P. 12(b). Conversion is inappropriate at this stage, because no discovery has yet occurred. See 2 James Wm. Moore, Moore's Federal Practice § 12.34[3][a] (3d ed. 2006) (noting "limited utility" of conversion where discovery may be required). The Court therefore will not consider these materials in deciding the motion.

Tiffany also submits copies of a "plaint" (i.e., a complaint) against Tiffany filed by BJP in the Bombay City Civil Court at Bombay (the "India action") and of two orders of the City Civil Court in that action, dated June 30, 2005 and June 13, 2006, respectively. (See Aff. of Jeffrey A. Mitchell, Ex. B-D.) In ruling on a motion to dismiss, the Court may consider any matter of which judicial notice may be taken. Hirsch v. Arthur Andersen & Co., 72 F.3d 1085, 1092 (2d Cir. 1995). "A court may take judicial notice of a document filed in another court not for the truth of the matters asserted in the other litigation, but rather to establish the fact of such litigation and related filings." Global Network Commc'ns, Inc. v. City of New York, 458 F.3d 150, 157 (2d Cir. 2006) (internal quotation marks omitted).

III. Motion to Dismiss Individual Counts

A. Breach of Contract

Count One of the Complaint alleges that Tiffany's termination of its distributorship agreement with BJP constituted breach of contract. None of Tiffany's arguments to dismiss Count One is meritorious.

1. Statute of Frauds

Tiffany first argues that because the alleged agreement was not in writing, it falls afoul ...


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